BNY Mellon Asset Management is to launch a long-only equity fund, the BNY Mellon Latin America Infrastructure Fund. The fund is a subfund of the sicav BNY Mellon Global Funds Plc and will be managed by Brazil-based boutique subsidiary BNY Mellon ARX Investimentos.

Latin America has the highest level of infrastructure investments globally with over $450 billion of projects planned until 2015. Brazil alone has 150 infrastructure projects slated with private participation worth over $229 billion.

BNY Mellon Latin America Infrastructure looks to provide, both individual and institutional investors, with investment opportunities in firms that benefit from increasing infrastructure spending and the growing number of projects that are planned for the region. The fund seeks to invest primarily in companies associated with infrastructure including capital goods, transportation, steel, telecommunications and energy in the key regions of Brazil, Mexico, Chile and Peru.

The fund uses a combination of «top down» macro analysis and detailed «bottom up» fundamental analysis and aims to outperform the MSCI Latin America 10/40 Index benchmark over a three to four year period with an equal or lower volatility.

It will have a concentrated portfolio of between 35-50 stocks and strict risk controls, this includes maximum weightings of companies and sectors in the portfolio, with the aim of ensuring capital preservation.

Anne-Laure Frischlander, Managing Director at BNY Mellon Asset Management France, said, "The combination of a relatively long period of political stability and robust economic growth are transforming Latin America into one of the most compelling regions for investors. Recent economic data from the region strongly points towards an increase in infrastructure budgets across Latin American countries, particularly in Brazil. Against this background, we believe that actively managed investment funds such as the BNY Mellon Latin America infrastructure fund could provide investors growing returns from the opportunities available in this sector"

The fund will be managed by one of the firm’s boutiques, BNY Mellon ARX Investimentos. The boutique is based in Brazil and targets multi-strategy and equity investments in the Latin American marketplace.

On the launch Jose Tovar, Managing Director at BNY Mellon ARX said: "We are living through an exciting investment era in Latin America. In addition to increasing political and macroeconomic stability and institutional and fiscal reforms across the region, we are also seeing a domestic consumption boom.

"Robust growth rates are now the norm rather than the exception with Brazil expected to increase its contribution to regional growth. Now more than ever before, there are better incentives for private infrastructure participation through public-private partnerships and increased government spending for planned major infrastructure projects. We strongly believe that the current economic momentum is likely to result in a prolonged period of sustained growth."